Light Reading
Vendor's acquisition was all about expanding its OSS for the IoT, which requires more flexibility, agility, and cost-effective platforms.

Ericsson Goes Beyond Telecom with MetraTech Acquisition

Sarah Reedy
7/29/2014
50%
50%

Ericsson's acquisition of MetraTech, announced Tuesday, is all about strengthening its billing support -- but not for its existing telecom OSS/BSS services. Rather, it's looking to break into new markets such as transport, utilities, and the Internet of Things (IoT), and to support its telco customers that are vying to do the same. (See Ericsson Acquires Billing Vendor MetraTech.)

Ericsson AB (Nasdaq: ERIC) is already a big name in telco OSS/BSS with a converged platform that supports both prepaid and postpaid billing, but where it has yet to make inroads thus far is in the burgeoning IoT market. That's where MetraTech Corp. comes into play.

The Boston-based billing specialist was formed in 1998 to provide metadata-based billing, commerce, and settlement platforms for a broad range of industries spanning 150 countries. The company, which raised $30 million in 2012, counts telcos such as Verizon Communications Inc. (NYSE: VZ) and BT Group plc (NYSE: BT; London: BTA) amongst its customer base, but it has had the most success in multi-vertical industries.

"This is not a telecom play; this is a multi-vertical play going forward," says Heavy Reading analyst Ari Banerjee. "It's helping Ericsson's service provider customers achieve that goal of being multi-vertical and becoming an Internet of Things player...This is how Ericsson is enabling the whole value chain."

For its part, Ericsson says MetraTech will deepen its expertise in billing as well as expand its geographic presence in the US. The Swedish giant has been talking up a "Networked Society" comprising countless connected devices, all of which will require new, personalized business models, often involving multiple partners. They don't follow the traditional telecom data models, and Banerjee says Ericsson needed a platform that was much more agile and cost effective.

"There's huge growth potential, but the revenue is minimal in M2M," he says, adding that revenues are only around 2 to 3% today. "When it comes to buying software systems to support that business model, [operators] won't put in a lot of money. They need something targeted towards the need, but also cost effective."


Light Reading recently caught up with Ericsson's Head of Networks Johan Wibergh. Find the interview Q&A here.


Ericsson has been building up its OSS/BSS business through M&A for awhile now. During the past few years it has acquired Telcordia and ConceptWave to help it become one of the biggest SPIT vendors in the industry. It has since launched a cloud OSS to support operator virtualization strategies and inked billing deals with carriers such as T-Mobile US Inc. . IoT represents the next step. (See Ericsson Launches Cloud OSS, T-Mobile Swaps Out Amdocs BSS for Ericsson , Ericsson Buys More OSS Smarts, and Leading Lights Finalists 2014: Outstanding OSS/BSS Vendor.)

The financial terms of the acquisition were not announced, but all 140 of MetraTech's employees and contractors will be joining Ericsson when the deal closes, expected before the end of the third quarter this year.

— Sarah Reedy, Senior Editor, Light Reading

(9)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
SachinEE
50%
50%
SachinEE,
User Rank: Light Sabre
7/31/2014 | 6:21:27 AM
The bigger picture
Ericsson's acquisition of Metra Tech is a great thing. They are looking to venture into new markets like transport and the internet of things. It might seem bleak now but looking at the aftermath of this venture, we find that the opening up of the IoT lab in Boston will enable some industries such as M-health the support they need not to mention that it will optimize communication networks so its no doubt a worthwhile venture.
SachinEE
50%
50%
SachinEE,
User Rank: Light Sabre
7/30/2014 | 2:39:29 PM
Re: Boston
On second thought, considering the fact that Ericsson as a company is itself headquartered in Boston, the idea of setting up an IoT innovation lab should not really come as a surprise. Maybe, just maybe, it may be a slight indicator to the fact that Ericsson may have more up their sleeves with this move than they are letting on. No conspiracy theory, just pure speculation.
SachinEE
50%
50%
SachinEE,
User Rank: Light Sabre
7/30/2014 | 2:38:52 PM
Re: Innovation Lab coming to Boston?
I would have thought that if an exclusive IoT lab was to be set up anywhere within the United States then it would most probably have been set up in the Silicon Valley area or somewhere in California close to that. As a keen follower and participant in the IoT movement I believe that this would be the best place considering how interdependent the various ends of IoT are. But all the same, this is great for Boston.
thebulk
50%
50%
thebulk,
User Rank: Light Sabre
7/30/2014 | 5:31:18 AM
Re: Innovation Lab coming to Boston?
If they really are goign to open up an IoT lab in the Boston area that will be pretty big, but not that shocking, right now Boston seems to be setting itself apart from other cites as an IoT power house. 
RitchBlasi
50%
50%
RitchBlasi,
User Rank: Light Sabre
7/29/2014 | 3:58:50 PM
OSS/BSS for IoT
Definitely a need to go out of the box, per se, for this kind of billing.  Flexibility is required if IoT reality is to match the hype.  I look at mHealth as an fragmented industry that could use this kind of support.  Looking at fitness and wellness, not specifically at healthcare, the case can already be made for requiring a platform like this to manage data, billing, etc. across multiple industries.
SReedy
50%
50%
SReedy,
User Rank: Blogger
7/29/2014 | 2:19:23 PM
Innovation Lab coming to Boston?
I just spoke with MetraTech CEO Scott Swartz, who hinted that Ericsson has big plans for Boston, where it's headquartered. He said they "view Boston as one of the areas in which they would like to stimulate innovation. We are a piece of that." Sounds like they are going to be opening an IoT innovation lab there in the future.

 
SReedy
50%
50%
SReedy,
User Rank: Blogger
7/29/2014 | 2:18:09 PM
Re: Ericsson's POV
I think transportation will be a big one too. It already is for most network operators, but MetraTech has a big business there too. It does the billing for O'Hare and London's tube.
jasonmeyers
50%
50%
jasonmeyers,
User Rank: Blogger
7/29/2014 | 2:02:34 PM
Re: Ericsson's POV
Interesting - Ericsson was already focused on helping utilities optimize their communications networks and make their operations more intelligent, so hopefully this wiil help bolster that effort. 
SReedy
50%
50%
SReedy,
User Rank: Blogger
7/29/2014 | 12:51:34 PM
Ericsson's POV
A bit more color from Ericsson, essentially confirming that it's filling a gap in its OSS/BSS offering and looking to expand into IoT -- Petter Jartby, Head of Solution AreaBSS, writes in an email to LR:

"This acquisition sees Ericsson addressing a major emerging market opportunity that a wide range of verticals have as billions of connected devices come on line. From transportation to utilities, there will be a mass of valuable data collected and delivered to power new services, form new partnerships and enter new markets. To successfully serve this market, Ericsson needed a billing solution that is adaptable to the demanding requirements of the XaaS and IoT economy. To be sure, while this acquisition helps us further expand into new markets, it also positions us to help our telecom customers do the same."
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
LRTV Custom TV
Exploring the Future of Cable Access

10|15|14   |   6:23   |   (0) comments


Cisco's Brett Wingo looks at where cable access architectures are heading, discussing the impact of DOCSIS 3.1, CCAP, Remote PHY, SDN, virtualization of cable networks and related technologies.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Forget the Internet, Brace for Skynet
Stephen Saunders, 10/15/2014
HBO Will Go OTT in 2015
Mari Silbey, Independent Technology Editor, 10/15/2014
Google: Carriers & Cloud Providers Need to Cooperate
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/16/2014
Could Data Be the New 'Currency'?
Ray Le Maistre, Editor-in-chief, 10/16/2014
CBS Takes OTT Plunge
Mari Silbey, Independent Technology Editor, 10/16/2014
Like Us on Facebook
Twitter Feed